Part 7: Our recent and ongoing work in the education sector

Education sector: Results of the 2010/11 audits.

In this Part, we discuss our recent reports and ongoing work in the education sector.

Recent reports

Variance of analysis report

As part of its annual report, a school board of trustees (board) is required to measure and report on how well the school has achieved its aims and targets for student achievement set out in the school's charter. It also has to report on how these results will be used in the following year. How well the school performs against its aims and targets, and the actions taken as a result, is reported in the analysis of variance (referred to as "variance reporting") in the school's annual report.

In 2010, we assessed how well a sample of primary school boards reported on student achievement in the variance reporting in their 2009 annual reports. We found wide disparity in the ease with which the boards communicated what they were doing in their variance reporting. Although some reports were very clear, others were hard to understand. In our view, the boards needed to think more carefully about their target audiences and tailor the information in the reports accordingly.

To help boards improve their variance reporting, in February 2011 we provided guidance to all schools on:

  • setting meaningful targets;
  • clearly describing what was achieved, and why; and
  • how best to use plans for the coming year.

Payments over and above a school principal's normal salary

In December 2010, we reported the results of our review of the additional remuneration paid to secondary school principals.34 In 82 (20%) of the 411 schools reviewed, auditors found that either additional remuneration had been paid without the approval of the Ministry of Education (the Ministry) or it was not clear whether some payments were remuneration that would need the Ministry's approval.

In most instances, the additional payments were not large. However, the underlying principles are still important. First, payments that are remuneration are lawful only if they are approved by the Ministry. Secondly, there is always heightened sensitivity around payments that have the potential to create private benefits, even if they are genuine business expenses. Thirdly, in some circumstances reimbursing a private expense can be unlawful and lead to prosecution by the Police.

After our report, the Ministry issued comprehensive guidance to schools to clarify when its approval is required.

For the most common forms of possible unlawful remuneration (for example, home telephone, Internet, or insurance bills, or the use of a car) we expected the Ministry, in keeping with its established practice, to seek clarification from the relevant boards. The Ministry has not yet told us whether it has sought this clarification.

The Ministry also said that it would consider requiring boards of integrated schools to disclose financial transactions with proprietors in their financial statements. This would help maintain the transparency of any remuneration received from proprietors by principals. The Ministry is still considering this.

We understand that the Ministry is also still considering the other issues we raised about payments by proprietors; that is, the possibility of some of the payments being unlawful, equality of remuneration for all state schools, and the proper management of conflicts of interest.

The Ministry agreed to publish a circular on the need for boards to consider recovering unlawful payments. This should ensure that boards are aware of the general expectation that they consider recovering the money when unlawful payments are made. This circular has not yet been published.

Ongoing work

New Zealand Qualifications Authority

In July 2011, we began a performance audit on how well the New Zealand Qualifications Authority (NZQA) ensures that National Certificate of Educational Achievement (NCEA) internal assessment for secondary students is accurate and consistent.

By carrying out this audit, we aim to:

  • provide assurance about the accuracy and consistency of the internal assessment by schools of one of the most important national qualifications for senior secondary school students;
  • provide assurance that NZQA accurately monitors the accuracy and consistency of internal assessment for NCEA assessment;
  • promote improvements in the accuracy and consistency of internal assessment by schools through recommendations from our work; and
  • add valuable insight into how national qualifications are managed and monitored.

We intend to publish the results of this performance audit in March 2012.

School governance

To build on the work that we have carried out on variance reporting, we will audit how well a sample of school boards carries out strategic planning and self-review. In particular, our audit will focus on:

  • how well the board uses information to underpin its strategic planning and self-review;
  • how coherently the board works to focus the school's efforts on student achievement, including how it aligns resources, policies, and practices; and
  • how well the board uses and responds to assessment data.

The report of our performance audit will include examples of good governance practice identified during our audit. The report will help boards to focus and improve their strategic planning and self-review function. We intend to publish this report by June 2012.

Focus on Māori education

We are setting up a framework of audits to consider aspects of Māori education during the next five years. The first audit will lay the foundation for future audits focused on Māori education. The audits will include activities and programmes under the Māori education strategy (Ka Hikitia – Managing for Success), and research, systems, and controls supporting these activities and programmes.

These audits will also look at the alignment of activities and programmes with broader Māori perspectives and objectives for the education sector and, potentially, with other relevant sectors. We intend to publish the results of the first audit in June 2012.

Teacher quality

Having teachers who are well equipped with the necessary skills to teach in our schools is a significant objective of the education system, given the role of the system in preparing our youth for the future.

In our 2010/11 work programme, we proposed to provide assurance over activities that are designed to improve the quality of teaching in the classroom. We have examined the system for assuring the quality of teaching, including the roles of the various public entities involved. We intend to report our observations and findings from this work in early 2012.

Special education

Our annual progress report, Public entities' progress in implementing the Auditor-General's recommendations (2012), will include a second report on the Ministry's progress with the recommendations that we made in our 2009 performance audit report Ministry of Education: Managing support for students with high special educational needs. We intend to publish the next annual progress report in April 2012.

34: Central government: Results of the 2009/10 audits (Volume 1), Part 8.

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